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Report and Financial Statements for the Year Ended 31 July 2018 Stephenson College Report and Financial Statements for the Year Ended 31 July 2018

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Report and Financial Statements for the Year Ended 31 July 2018 Stephenson College Report and Financial Statements for the Year Ended 31 July 2018 Colle Report and Financial Statements for the year ended 31 July 2018 Stephenson College Report and Financial Statements for the year ended 31 July 2018 Contents Page Operating & Financial Review 2 Statement of Corporate Governance and Internal Control 14 Governing Body's statement on the College's regularity, propriety and 21 compliance with Funding body terms and conditions of funding Statement of Responsibilities of the Members of the Corporation 22 Independent Auditors' Report to the Corporation of Stephenson College 23 Independent Reporting Accountants Assurance Report on Regularity to the 25 Corporation of Stephenson College Statement of Comprehensive Income 27 Statement of Changes in Reserves 28 Balance Sheet as at 31 July 2018 29 Statement of Cash Flows 30 Notes to the Accounts 31 Stephenson College Operating and Financial Review NATURE, OBJECTIVES AND STRATEGIES The members present their report and the audited financial statements for the year ended 31 July 2018. Legal status The Corporation was established under the Further and Higher Education Act 1992 for the purpose of conducting the business of Stephenson College. The College is an exempt charity for the purposes of the Charities Act 2011. The Corporation was incorporated as Coalville Technical College. In June 1997, the Secretary of State granted consent to the Corporation to change its name to Stephenson College. Mission The mission of Stephenson College is "Excellence in Innovation and Learning". Public Benefit Stephenson College is an exempt charity under Part 3 of the Charities Act 2011 and is regulated by the Secretary of State for Education as Principal Regulator for all FE Corporations in England. The members of the Governing Body, who are trustees of the charity, are disclosed on page 16. In setting and reviewing the College's strategic objectives, the Governing Body has had due regard for the Charity Commission's guidance on public benefit and particularly upon its supplementary guidance on the advancement of education. The guidance sets out the requirement that all organisations wishing to be recognised as charities must demonstrate, explicitly, that their aims are for the public benefit. In delivering its mission, the College provides the following identifiable public benefits through the advancement of education: • High-quality teaching • Widening participation and tackling social exclusion • Excellent employment record for students • Strong student support systems • Links with employers, industry and commerce. The College delivery of public benefit is covered throughout the Operating and Financial Review. Principal place of business The College's principal place of business is: Stephenson College Thornborough Road Coalville Leicestershire LE673TN 2 Stephenson College Operating and Financial Review (continued) Implementation of the Strategic Plan The College's Corporate Objectives are designed to deliver the mission during 2017/18: The College is committed to: Quality We will achieve outstanding results by being innovative and using the creativity of all of our stakeholders. Efficiency Working collaboratively, we will add value for the stakeholders we serve by understanding, anticipating and fulfilling their needs and expectations. Diversification We will empower our colleagues and create a culture to support efficiency and achievement in both organisational and personal goals. Corporate Social Responsibility We will have a positive impact on the world around our College by advancing the economic, environmental and social conditions of the communities we serve. 3 Stephenson College Operating and Financial Review (continued) The Operating Statement illustrated actions for the Corporate Objectives to be achieved and the risks associated with each. The College has achieved the following: Quality The College continues to self-assess with an overall grade of 'Good' following the Ofsted inspection in May 2017. Education and Training all age, all level overall achievement exceeds the national rate. Apprenticeship overall and timely success both exceed national rates. Progress in English and maths by 16-18 learners exceed sector averages. Adult learners continue to exceed national rates in all outcome based success measures, including sustained positive destinations and benefit learners also exceed the national rate for sustained employment. Efficiency Applying the Ofsted Common Inspection Framework 2015 criteria, the College has self assessed the effectiveness of leadership and management grade as 'Good.' The assessment grade, as judged by the Education and Skills Funding Agency, for the financial health of the college is 'Outstanding' for 2016/17 and provisionally assessed as 'Outstanding' for 2017/18. Diversification Provision for the unemployed is delivered through a range of sector based work academy programmes delivered in conjunction with Job Centre Plus and a number of companies in Leicestershire. The College delivers national apprenticeship training in the construction, engineering and motor vehicle sectors which include progression routes to Higher National Diploma Courses. Adult provision, graded outstanding by Ofsted, largely comprises distance learning courses delivered across England. Corporate Social The College supports the Skills Show and World Skills Responsibility competitions. The College quality assured the World Skills UK Professional Recognition Programme pilot. The College is a member of the North West Leicestershire Economic Growth Group. The Principal and Chair of Governors represent Leicestershire as members of the Association of Colleges East Midlands regional committee. The Principal is a member of the Association of Colleges (AoC) Board representing the East Midlands and represents the AoC as a board member of the Education and Training Foundation. 4 Stephenson College Operating and Financial Review (continued) Financial objectives The College's financial objectives are: • To maintain a financial health grade, as measured by the Education and Skills Funding Agency, as "Good" or "Outstanding". • To achieve an annual operating surplus before FRS 102 pension adjustment. • To pursue alternative sources of funding, on a selective basis, consistent with the College's core competencies, and the need for a financial contribution to the College's overall finances. • To generate sufficient levels of income to support the asset base of the College. • To fund continued capital investment. • To increase the efficiency of procurement. A series of performance indicators have been agreed to monitor the successful implementation of the policies. Performance Indicators FE Choices performance indicators are available on www.gov.uk and cover: • Success rates • Learner destinations • Learner satisfaction • Employer satisfaction 5 Stephenson College Operating and Financial Review (continued) FINANCIAL POSITION Financial results The College generated a deficit before other gains and losses in the year of £384,000 (20 16/17 deficit of £ 127, 000) and comprehensive income of £ 1,481,000 (2016/17 £798,000). The College has accumulated reserves of £11 ,825,000 and cash balances of £3,092,000. The College wishes to accumulate reserves and cash balances in order to create a contingency fund to address any future needs of the College. Tangible fixed asset additions during the year amounted to £101,000. This was entirely equipment purchases. The College has significant reliance on the education sector funding bodies for its principal funding source, largely from recurrent grants. In 2017/18 the funding bodies provided 75.3% of the College's total income, (2016/17 71.1 %). Treasury policies and objectives Treasury management is the management of the College's cash flows, its banking, money market and capital market transactions; the effective control of the risks associated with those activities; and the pursuit of optimum performance consistent with those risks. The College has a separate treasury management policy in place. Short term borrowing for temporary revenue purposes is authorised by the Accounting Officer. All other borrowing requires the authorisation of the Corporation. Cash Flows The net cash inflow for the year was £43k (2016/17 £902k). The year-end balance of investments é:HH.J cash in hand and bank of £3,092111 was regarded as satisfactory. Liquidity During the year, the College had no new loans. The size of the College's total borrowing and its approach to interest rates has been calculated to ensure a reasonable cushion between the total cost of servicing debt and operating cash flow. During the year this margin was comfortably exceeded. Reserves Policy The College has no formal Reserves Policy, but recognises the importance of reserves in the financial stability of an organisation, whilst ensuring that adequate resources are provided for the College's core business. The College currently holds no restricted reserves. As at the balance sheet date, the Income and Expenditure account reserve stands at £11 ,825k (2017: £10,344k). It is the Corporation's intention to increase reserves over the life of the Strategic Plan, by the generation of annual operating surpluses. 6 Stephenson College Operating and Financial Review (continued) CURRENT AND FUTURE DEVELOPMENT AND PERFORMANCE Student Numbers In 2017/18 the College has delivered activity that has produced £9,613,000 in funding body main allocation funding (2016/17 £9,425,000).The College has approximately 5,840 funded or co-funded learners and 2,565 non funded learners. Student achievements
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